The Brazilian Startup That’s Jumping Out of Planes to Help Poor Kids Attend College

On the evening of November 7, 2014, Marco Fiesben's phone buzzed. On the other side, an executive at Twitter’s Brazilian operations and a dear friend cheers. “You know that your physics live class is among the global trending topics right now, don't you?”

It was the eve of Enem, Brazil’s national college entrance exam that takes place once a year. That year, almost 9 million students took the test—making it the second largest national test in the world. (China comes in first: Last year nearly 10 million Chinese students took the gaokao, the country’s equivalent of Enem.) During the hours leading up to the exam, 250,000 students simultaneously tuned in Descomplica, a Rio de Janeiro-based startup founded by Fiesben in 2011 that offers online test prep videos and lessons.

The company has become a mini-celebrity. When the social media team recently shared on Facebook that it was heading to Fortaleza, a city in northeastern Brazil, for a business trip, they were greeted by a group of students at the airport. One girl invited them for coffee at her house as a way of thanking them for their service. The team accepted.

From left to right: Hansen (geography teacher), Oda (biology teacher), the student from Fortaleza, and Rafael (writing teacher) in her house

In four years, Descomplica has produced more than 19,000 videos, of which 2,000 are available for free. The company estimates it has helped 42 million students during this period. And with a fresh $8 million from a Series C round from US investors this June, the team wants to expand its blend of education technology and entertainment.

“We are becoming a serious video producer,” Fiesben says. The company’s division of labor makes this clear: at least half of the 100 employees work on video production across three recording studios. The company airs eight hours of live classes five days a week. While classes are happening, the social network team stimulates online conversations about the topics discussed. “We deliver online classes, but we do our best to re-create the real classroom environment. We want the students to have this sense of belonging,” Fiesben states.

In Brazil, 86 percent of elementary, middle- and high-school students are enrolled in public schools, many of which lack adequate technology infrastructure. These learners often come from low-income families, and they are the demographic that Descomplica wants to serve the most. “We do have students from top-notch schools, but our mission is to deliver a high level education for the ones who have no conditions to study in good schools,” Fiesben says. The company’s subscription rates are affordable for those with modest incomes: users who sign up for a one-year contract pay R$12.99 (less than US $4) per month, or pay R$24.99 (US $7) per month.

Currently, Descomplica's videos cover all academic subjects taught at Brazilian high schools. In addition to live classes, subscribers have access to the full library of recorded videos, study guides, live online tutoring, and the opportunity to have one essay reviewed by a teacher every month. The company is also pursuing partnerships with universities to use their videos to help students who are struggling in their studies.

Over half of the company’s subscribers visit the site at 10 times or more each month. The company is mum on the exact number subscribers, but claims that 78 percent of high school students who paid for their service were accepted into college last year. That’s an impressive claim given that only 15 percent of Brazilians between 18 and 24 years old are enrolled in a higher-ed institution.

The Descomplica team

For the company, the sky is the limit—literally. Fiesben’s team is working on a new video series, called “Epic Classes,” that attempt to make lessons not just engaging, but also unforgettable. In one episode, Fiesben himself jumps out of a plane and explains concepts around gravity as he’s parachuting back down to the ground.

Fiesben’s ability to woo both users and investors has put him at the center of attention among Brazilian entrepreneurs The Brazilian education technology ecosystem—and the capital needed to support it—is still at a nascent stage. Many local investors don’t find this industry attractive, and most investments are fairly conservative by US standards. Seed rounds are usually under R$1 million (approximately US $280,000), and Series A deals rarely exceed R$ 5 million (US $1.4 million).

Having raised over $14 million, Fiesben isn’t entirely surprised that he often fields questions from fellow entrepreneurs about venture capital. “It is rare for me to have a week without having meeting with someone interested in how to attract US investors,” he says. He knows the pain quite well: after failing to convince Brazilian investors in 2012, he traveled to Silicon Valley and New York to secure the company’s first $1.5 million in venture capital. With the exception of a few angels, all of the company’s backers hail from outside from Brazil.

Descomplica is not the only Brazilian edtech startup to fundraise abroad. In May, Geekie, an adaptive learning platform, raised $7 million in a series B round. In 2013, Open English, an online platform for English instruction, raised $65 million in a series D round. Unlike Descomplica, however, both these companies were able to accomplish the rare feat of getting initial funding from Brazilian investors.

Fiesben believes Brazilian investors are warming up to providing early-stage support to education entrepreneurs. “Getting investments is always difficult, but there are some myths around it. Contrary to what people think, it is not that hard to fundraise in Brazil. And neither is it easy to do it abroad.”

For fellow entrepreneurs from Latin America looking to raise money in the US, Fiesben offers a general observation: “American investors are practical and straightforward. And I learnt that the hard way,” he says. Here are his five tips for any entrepreneur looking to fundraise in the US:

Learn English and all the specific terms that are used in a fundraising negotiation;

Be prepared to receive tough feedback;

Do not fall too much in love with your product;

Understand your audience and the problem you are trying to solve;

Practice your pitch—be direct!

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